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What to address in an investment partnership agreement

On Behalf of | Feb 5, 2021 | investment Partnerships

Investing in California real estate alongside like-minded individuals may offer many advantages. It may give you access to more knowledge or capital than you would have otherwise, for example. It may also make it easier and faster for you to generate wealth through your investments. An important aspect of any solid investment partnership is a strong partnership agreement, and the language you include in yours may have far-reaching effects.

According to, a strong investment partnership agreement contains specific elements and gives you something to reference in the event that something unanticipated arises. What areas do you want to make sure to address in your investment partnership agreement?

The contributions and expectations of everyone involved

Make sure that your agreement dictates exactly how much each partner contributed from the get-go. If you have plans in place as far as who plans to invest what and when moving forward, be sure to include this information, too.

Profit and loss information

In the absence of an investment partnership agreement, there is an assumption that all partners are going to split profits evenly. You have the opportunity to dictate otherwise in your agreement, though. You may use the agreement to stipulate how much of a percentage each partner has in the business. If preferable, you may use it to state that each partner’s profits and losses are going to fluctuate based on their contributions to the business.

While these are some key areas to address in your agreement, there are many other areas you may also want to consider therein. You may also want to use the agreement to outline who has decision-making authority, for example, to address the process of adding or removing partners if need arises.